Basket £ 0.00 (0 items)
You are here: HomeArticle › Towards SRM

Towards SRM

Cirquent's Tim Haigh explains why customer relationship management is evolving to become 'stakeholder' relationship management.

Relatively few companies have incorporated customer relationship management technologies effectively, even though the concept has been around for a long time now. Many early adopters failed to implement often highly complex and costly systems successfully, with poor-quality data. The result? Little user take-up.

In some instances, the problems related to the chosen technology. Frequently, however, the shortfall of delivery against expectation can be traced to a lack of training, resulting in a fundamental lack of understanding among end users as to how to get the best from the CRM system. Likewise, companies have failed to address cultural issues around transparency of process, which demands a very different way of working.

Yet there are also many best-practice examples of how CRM, properly implemented, can deliver powerful benefits in both customer service and internal efficiencies. And this has recently moved a significant step further, as organisations have begun to recognise that these benefits can be extended to other third-party relationships, including suppliers, partners and intermediaries.

This is because the way in which an organisation reacts to all these contacts is broadly similar. The concept of CRM as a central repository for all information relating to an individual person or organisation remains the same, irrespective of whether they are a customer or not; and the processes necessary to transact with that third party are again similar.

The result is that an advanced CRM system becomes a 'stakeholder' relationship management, or SRM, tool, with the concept of customer management applicable to any department managing external interactions and relationships.

Broad use

Like many management tools, CRM started at an enterprise level, though more recently it has expanded to make a positive contribution to smaller businesses. Indeed, CRM applications have arguably been especially successful at SME level - where staff are often more used to information sharing across the organisation than those in more siloed larger enterprises, where this can be challenging.

Even among those businesses that may have had a less-than-happy initial experience with CRM, the concept can still appear attractive and worth pursuing. Often this is because, in looking to understand and get closer to their customers through improved service, companies realise CRM can also support the management control of internal processes - central to improving operational effectiveness.

This process has increasingly extended to other stakeholders, as businesses seeking to improve the customer experience have started to recognise the parallel gains to be had across all third parties with whom they have an ongoing relationship.

However, effective change management in CRM projects, as elsewhere, requires a highly integrated, collaborative and proactive approach, working with all relevant stakeholders from day one in order to realise the anticipated business benefits at all levels - strategic, operational and financial.

So let's review the opportunities available and what you need to do to realise them:

Strategic benefits of CRM

  • Improves the organisation's capacity to change, by establishing a learning organisation. Planning is the key here. If a programme is not planned, understood and implemented effectively, it is likely doomed to failure, as staff become indifferent to the prospect of change and cynical about its likely implementation.
  • Increases employee motivation and commitment. The key here is to align organisational goals to specific individuals, ensuring that staff are motivated and focused in the right direction and that they are clear about the likely benefits to them personally of the proposed change.
  • Lowers resistance to change and increases motivation.

Operational benefits of CRM

  • Identifies key performance indicators. Critically, at an operational level many businesses do not have a clear understanding of what their KPIs actually are. As a result, KPIs are not clearly communicated and staff are not empowered with the right kind of skills to meet them.
  • Increases quality and transparency of the change process.
  • Maximises user acceptance and adoption of change initiatives.

Financial benefits of CRM

  • Minimises consequential costs (eg, eliminating rework and lowering support costs).
  • Projects are completed more rapidly, with faster realisation of ROI.
  • Minimises hidden transformation costs (eg, reduced productivity).

In truth, it is often hard to pinpoint what specific financial benefits CRM change management will bring an organisation. The best practice is for your company to baseline its current financial performance and then compare that to the position after changes have been implemented and on an ongoing basis thereafter. This enables the business to track what the real improvement is.

In addition, companies often fail to identify problems until it is too late. The result of ineffective change management will typically be that staff leave the business, productivity is reduced, people stop using the systems and fail to follow processes, eventually impacting negatively on the bottom line.

Understanding the problem

Any business looking to improve its CRM capability needs to understand upfront the precise nature of the user adoption risks.

It is equally important to undertake this at various levels across the business. For example, process transparency may appear a highly desirable goal from a management perspective, but at an operational level it could appear as intrusive monitoring.

It is then important to address implementing the right behaviours, perhaps through appropriate rewards or incentives. This is essential in order to identify the real business need at the outset as part of the initial diagnostic phase, which is typically undertaken with the internal business sponsor. You need to get 'under the skin' of the whole business to get the right perspective on the problem. This can only be done via an open and honest dialogue across all levels of the organisation - board, departmental and individual - with any resistance tackled through informal one-to-one discussions.

This applies just as much in ensuring realistic goals and timescales for the roadmap, as it does in establishing where the business is today at the start of the journey. This will typically be a multi-phase process, ideally involving as many people as possible, in order to get broad buy-in to a communal vision.

The initial diagnostic phase should result in agreement on the way forward. Next, more in-depth analysis needs to be done to define the requirements for the chosen solution.

You can then move to a detailed design phase, which determines how the system has to work in order to support the various functions throughout the business and, critically, integrate with other existing systems. Once this is complete, the development/build phase can be undertaken by the technical team, followed by deployment.

Note that in many companies, the CRM solution is introduced on a phased basis - by country or by function, for example. This helps to identify areas for improvement or further development in light of experience and evolving requirements.

Again, companies embarking on CRM development recognise that this is not a one-off project with a defined start and finish date.

Keeping customers happy

In summary, in today's tough economic environment, it is more important than ever to ensure that your business secures and retains its customer base, at the same time driving customer acquisition and becoming more efficient. A well-targeted and designed CRM solution, properly implemented, can deliver these seemingly irreconcilable goals.

The ideal CRM solution will have the customer, or stakeholder, at its centre - supported by effective sales, marketing and customer service processes, using a broad range of communication channels and integrated with other business support systems to provide a complete customer view. And it is this latter form of integration that is often the greatest challenge, because many businesses underestimate its importance.

Put simply, without integration, the view of the customer or stakeholder will be incomplete - leading to frustration on the part of individual users who will cease to use the system to its full advantage as a result. Equally, without full and effective training, users will not understand CRM's value and how to use it, with similarly disappointing results. Get it right, however, and CRM can make a major contribution to improving your business' competitiveness and bottom line.

(ITadviser, Issue 59, Autumn 2009)

 

Contact

For more information about The National Computing Centre and our services, please contact us at the details below:

Email: info@ncc.co.uk
Telephone: +44 (0)870 908 8767
Fax: +44 (0)870 134 0931

Click here for more contact information


TwitterFollow us on Twitter
Linked InJoin our LinkedIn Group
FBLike us on Facebook

 

Management Guidelines

NCC Guidelines Vol 5 No 1

more in Management Guidelines

 

Professional Development

Cloud Computing

more in Professional Development

 

Analyst Digest

September 2016 Bulletin published

more in Analyst Digest